Bbi Holdings Share Discussion Threads

[shuisky] 05/4/2007 14:48

yep. looks like they are starting to utilise the manufacturing capacity that they have bought via the acquisitions. Hopefully, the THE deal will create synergies by which they can offer more attractive pricing to pharma co's.

Short term I've no idea where the share price is headed, due to the THE deal. I think the guys on the THE board make a good point, in that THE was main-market and holders will have to sell their AIM-listed BBI stock due to the ISA restrictions. Could be volatile, but I'm a buyer if anything drastic happens. The MM's can get savage in these situations.

Otherwise, all looks well, and we await results in the Summer.

[silverfern] 05/4/2007 09:20

Looks to me like the news today is very good indeed; of course the timing means it won't be seen but the contract should give great assurance going forward.

[rhcm] 02/4/2007 19:54

I'm a bit of a lurker but I have bought in today as the share looks to be good value taking into account the financial projections.

[silverfern] 27/3/2007 10:14

This company have only made shrewd acquisitions in the past - I bought further today

[stegrego] 26/3/2007 17:04

Depends on what they end up paying for THE i suppose
Obviously a good fit as they do pretty much the same sort of work and i guess some cross-selling would be possible

[joshalexander] 26/3/2007 16:49

Stegrego

Good call, looks like you were spot on.
Do you consider this a good deal for BBI?.


Thanks in advance

[stegrego] 24/3/2007 16:59

See i told you that was the rumour i heard a couple of months ago and now its in todays Guardian...

[stegrego] 24/3/2007 16:55

long-awaited takeover of enzyme company Theratase could come as early as Monday. The potential predator, diagnostics firm BBI, yesterday said it had agreed a financing deal with Inverness Medical Innovations of the US. BBI is issuing Inverness with 5.2m shares - 16% of its share capital - at 144p each to raise £7.5m towards "financing a defined acquisition target". Traders believe Theratase - with a market capitalisation of £20m - is that target. The deal has been on the cards since December 13 when Theratase confirmed an approach. Analysts have speculated that Inverness, which already had an option to buy a further 16% of BBI at 100p a share, may eventually decide to snap up the enlarged group. Theratase was steady at 54.5p while BBI slipped 0.5p to 147.5p.

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[sivadnoj] 19/2/2007 09:25

This is most welcome. Not aware of any company news or recent press coverage.

[alftupper] 30/1/2007 11:28

on the move

[fellowes2] 28/1/2007 20:16

shuisky

Good informative post, thx.
I dont hold currently, but they are on my watch list.
I will wait for a pre close trading statment (late March last year)before buying. By then BBI will need to report on the progess of the latest
aquisitions, together with a detailed update on trading. This removes a large part of the risk and there should still be plenty of upside if all is progressing well.

[sivadnoj] 28/1/2007 20:04

Shuisky - thanks for that. Regards

[shuisky] 28/1/2007 19:36

Stegrego-Thanks.

Sivadnoj-AFAICS (and I'm happy to be corrected) BBI would issue the shares to IMI and existing shareholders would therefore see their holdings diluted by 25%



IMHO it's a good practice to dilute the forecast EPS of BBI by 25% in order to factor this in. The T & G (house broker) forecast should have the licence fees factored into estimates.

Fellowes2- u r right that they could go for a placing or try and borrow. But IMHO, placing/borrowing 10m is a big 'ask' for a company (BBI) of mkt cap of 38m. Especially, considering that the 7.5m (IMI) unsecured convertible loan was for the acquisitions.

With regards the customers issue. You have to bare in mind that the IMI deal gives BBI's customers access to IMI patents, and also means that-if they work with BBI-they won't run the risk of having their products patents challenged by IMI. IMI has a dominant position in the IP of lateral flow testing, and working with BBI means that theycan ensure a worry-free commercialisation of product.

For example, look at the Verax deal...



'Under the terms of the agreement BBI will manufacture Verax's PGD Platelet test
for the global marketplace. The value of this contract in the next two years is
forecast to be in excess of $1.5M. In addition BBI will receive a start up fee
of US$600,000, payable in 3 instalments; $100,000 on FDA approval and then
$250,000 on each anniversary of the approval.'

BBI were working with Verax on this product since 2002. The deal is exclusive.

and...



'Verax Biomedical Inc., a leading developer of rapid tests for detecting bacterial contaminants in blood cells and tissue, has signed a 10-year agreement with British Biocell International (BBI) to manufacture the Verax Platelet PGD(R) Test. Under terms of the agreement, BBI could produce as many as 50 million tests and will establish a second manufacturing facility to handle Verax production.


The agreement comes in anticipation of strong worldwide demand for the Platelet PGD Test and follows the recent Verax announcement of an exclusive worldwide distribution agreement with Abbott Diagnostics to market and distribute the test, which is currently being evaluated in clinical trials.'

...so I don't consider it likely that the likes of Verax will suddenly pull out. BBI is more than just a contract manufacturer, it has access to IMI patents, and that relationship is critical to understanding the co.

There ARE downside risks. IMHO, these pertain to the usual acquisition risk/reward issues. Clinical trialling of Verax platelet. The success of Abbott Labs in distributing the platelet. FDA granting approval of the transfer of technology from IMI to BBI. These things can be delayed.

[stegrego] 26/1/2007 19:35

I dont have a direct link - it was one of the left hand page tops in Shares mag shortly before THE gave a profit warning - about 5-6 issues ago and it mentioned the story there in a small piece about THE.

All i remember - sorry

[sivadnoj] 26/1/2007 16:49

I'm sure this is a foolish question, but could anyone explain please how the IMI option works? AIUI, in return for the use of IMI's patent portfolio, in lieu of paying royalties BBI has granted IMI an option to acquire 16% of the share capital for 100p. Given the share price trades at above this amount, where (or who) would they acquire the shares from?

[fellowes2] 26/1/2007 16:40

The bid does not have to be all cash, BBI can issue shares and/or borrow more. I like BBI and its in a growth sector, the only downside I see is that most of its business is from a handful of customers. If one of those went elsewhere, it would have a very nasty impact on profitability.

[shuisky] 26/1/2007 08:49

Stegrego,

Do you have an links or other info alluding to a BBI bid for THE?

IMHO, it's unlikely.

THE has a current mkt cap of around 19m. BBI has recently made an agreement with Inverness Medical for the option over an unsecured loan of 7.5m. At the interims they had 2.1m in cash. This totals a 'war chest' of 9.6m, so it's hard to see a bid for THE. At the last interims BBI said...

'Subsequent to the period-end, the group has reached agreement with its key
strategic partner (IMI) to have access to up to £7.5m by way of a convertible
loan to assist in the funding of an identified target. The Board had thought it
had reached agreement with the target company's board on the basis that it was
prepared to recommend this to its shareholders. Since then, the value of the
target has moved against us and made the transaction financially unattractive
compared to other opportunities under consideration'

...and certainly if you look at the THE chart...



..there is a big old spike prior to November, which adds support to the idea that THE was the co BBI were talkng about. However, none of previous BBI acquisitions have been anyting like this scale. Furthermore, they are taking unsecured loans out. So where and how could they get the funding for a deal of the size of THE?

it doesn't add up, IMHO.

[honiton] 26/1/2007 06:57

ummm...worth a look

[fellowes2] 26/1/2007 06:49

I would wait for a trading update, just to confirm everything is still going well.

[stegrego] 25/1/2007 22:11

It was muted that BBI where looking at buying Theratase and then the THE price dropped 30% odd due to a customer cancelling an order.

THE is still in takeover mode - so someone is looking at it and it may be BBI


Still watching here - want in but not sure at what price at the minute

[fellowes2] 18/1/2007 17:37

I think the price weakness is simply caused by some uncertainty.
The Market is expecting more aquisitions following last years placing which have not happened yet, and the one thing the Market dislikes is uncertainty

[shuisky] 18/1/2007 16:52

Yes I agree, and I bought some more on some recent weakness.

One thing that intrigues me is that the press (including the Guardian tip) don't seem to have picked up on the fact that their partner Verax Biomedical has signed a major exclusive worldwide marketing and distribution agreement with Abbott Labs...



...and Abbott Labs are a major worldwide player.

Of course, BBI has 10 year manufacturing agreement to manufacture the Verax Platelet PGD Test.

AFAICS, Their broker has left forecasts unchanged on 10.4x 2008 Earnings. Granted, it's no certainty that the Platelet will be a success and it will take time to build up sales, but Abbott Labs is a 77bn Gorilla in the industry and already has fantastic distribution channels.IMHO, the poosibility of GE buying Abbott Labs Diagnostic business should not have an effect on this.

The sells today look like a host of small retail punters selling out or reducing position. Everyone's intitled to take some profit. FWIW, I don't think now is the time to sell out, but retail investors will do strange things.

[silverfern] 18/1/2007 08:36

beginning to look like an opportity to top up

[shuisky] 02/1/2007 17:30

Well if the commies are backing it...

Joking aside, there's nothing sinister looking in the trades. However, I'm surprised the MM's didn't mark it up on the Guardian Tip.

[alftupper] 02/1/2007 17:17

No reason as far as I can tell

Tipped today in the Guardian